Palm kernels from Malaysia and Indonesia and dried distillers grain from the United States are being considered as urgent stockfeed substitutes as farmers face a looming “fibre drought”.
With cottonseed and grape marc supplies drying up or unavailable, some stockfeed suppliers are actively considering large importations of palm kernels from Asia as a fibre source.
But any such move faces a red-tape nightmare with Australian customs. One supplier put in an application to import palm kernel last November and it was not approved until July.
One leading stockfeed company executive called for national action to allow the stockfeed in “as something needs to be done” urgently to keep cattle and sheep flocks going in drought-affected areas through to October, when more local fibre sources would be available. Even that fodder supply was also contingent on rain falling on fodder crops in southern NSW in spring.
A major stockfeed supplier said a national roundtable discussion was needed on stockfeed supplies and permits.
At the moment, hay can be sourced from Victoria and South Australia, with some grass hay from Queensland as well as feed grain being brought in from Western Australia and South Australia by train.
But what Australia is facing is a “fibre drought”, the leading supplier said. “We are not just in a drought, we are in a fibre drought.”
It is believed the multi-national, Cargill, has considered importing palm kernels, with a supplier suggesting it could achieve a 50,000 tonne shipment that would help alleviate the stockfeed crisis.
Also, international ag business, the Singapore-based Wilmar International, has large palm kernel stocks at hand and could actively import kernels. Wilmar describes palm kernels as “known for its balanced energy and protein, high fibre, good level of residual oil and high palmitic acid, it is widely used in compound feeds for adult ruminant livestock such as dairy cow, beef cow and sheep”.
The palm kernels could be sold for relatively much less than other available stockfeeds, with barley hitting record highs of over $370 a tonne, cottonseed hitting $650/tonne in the Darling Downs and the last stocks of grape marc out of Renmark, SA, hitting an astonishing $70/t (normally sold at $20/t).
Protein appears available with soy and canola available and with good harvests expected in Western Australia and South Australia to help keep feed grain moving into NSW and Queensland. The supply of feed grain will continue for many months. Even straw out of Victoria is being considered as a fibre substitute.
Producers are also facing a shortage with cottonseed and cottonseed meal. Cargill was making cottonseed meal at Narrabri, but liquidity in the industry was weak with farmers and ginners holding on to cottonseed supplies.
Peter McBride, corporate affairs director with Cargill Australia gave this picture of the stockfeed situation: “Feed wheat and barley moving by ship and rail from WA and SA into Qld and NSW; Cargill has been moving feed grains from our grain feed SA sites into NSW by rail,” Mr McBride said. “With good forecast production in WA and SA we expect this movement of feed grains to continue into eastern Australia.
“Regarding cottonseed, Cargill is currently producing cottonseed meal at our Narrabri plant. Due to drought there is little liquidity in the Australian cottonseed market as farmers and ginners hold onto their cottonseed. Hence we are not crushing the volumes the market demands, or indeed, we would like. Cargill is looking at substitutes for cottonseed to meet customer demand.”
We are not just in a drought, we are in a fibre drought.
- Leading stockfeed supplier
Hay has risen almost $100 a tonne in just one week in many areas. Drought-hit NSW farmers are even sourcing hay from Far North Queensland, where prices of up to $600 a tonne have been quoted.
The Australian Fodder Industry Association chief executive John McKew said obviously supplies of hay were tight and it was an unknown how much hay was left to source. Supplies would stay tight until at least November when new fodder would come on the market. Good quality oaten hay was selling from $350 to $400 a tonne, and he had heard some evidence of oaten hay over $500 a tonne.
“The supply situation has not changed – it’s tight – and that won’t change until new supplies come on board in October to November.”
There were cuts of lucerne hay and barley hay in Queensland coming on stream. There were no figures on how much hay was left to source. The AFIA has called for a national fodder data base to be established.
The AFIA gave this glum report on the hay situation last week in central NSW: “Demand remains high in central west NSW. Supplies are coming from South Australia and Victoria. Fodder supplies are difficult to source. Prices have firmed this week. Cereal hay: +100 ($500 to $600/t). Prices have firmed this week. Lucerne hay: +50 ($550 to $650/t). Prices have firmed this week. Straw: +/-0 ($220 to $320/t). Prices remain steady this week. Pasture hay: +10 ($400 to $520/t). Prices have firmed this week.”
“Cereal hay prices have firmed in the Darling Downs, central west NSW, Bega, Goulburn Valley, southeast South Australia and central South Australia. There have been no price changes noted in Gippsland, southwest Victoria, Tasmania and Western Australia.
“There is a lot of hay being transported around the country of varying quality. We caution buyers and recommend feed-testing and viewing fodder before purchasing to be sure of quality of feed.”
